The dip buyers jumped back into the market after the sharply lower open as the SPY had a low of $442.87 that was just above the weekly S1 at $442.83. SPY rallied for the rest of the day to close at $446.97 which was above Friday’s high. The volume was strong in the last hour as the OBV stayed positive on the correction. On a short term basis this indicated that the rally could continue but the S&P futures are down 20 points. There are no new buy signals yet for the inverse S&P ETFs.
However, the market internals did not rebound with prices with 2-1 negative A/D umbers on the NYSE and they were even worse in the Nasdaq Composite. There was also an increase in the NYSE New Lows and on the Nasdaq there were more new lows than new highs. This indicates that the rally is not broadly based. The NYSE Stocks Only A/D line is now negative.
This is a further sign that the market is getting more vulnerable. There are no new ETF or stock recommendations for now.
Best - Tom
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